Aberdeen UK Smaller Companies Growth Trust plc has agreed to merge with JPMorgan UK Small Cap Growth & Income plc through a proposed reconstruction scheme, the companies said.
AUSC shareholders will receive new shares in JUGI under the deal or may elect to take cash for some or all of their holdings. Cash elections are subject to an aggregate limit of 35% of AUSC's share capital, calculated on a residual net asset value basis less a 2% discount. Shareholders who do not submit a valid cash election will be automatically deemed to have chosen the share rollover, with new JUGI shares priced on a formula asset value basis.
AUSC's board initiated the consolidation after the trust repurchased more than half of its issued share capital over the past five years to manage discount volatility. The board cited concerns over reduced liquidity and the company's ability to grow under current conditions, and noted that the ongoing charges ratio is expected to rise in the current financial year.
Under the terms of the enlarged JUGI, management fees will be 0.6% per annum on net assets up to £200 million — down from 0.65% — and 0.55% on net assets above that threshold. The ongoing charges ratio for the combined entity is estimated at 70 basis points. JPMorgan Funds Limited will contribute an amount equivalent to 12 months of management fees to offset transaction costs and a separate three-month fee contribution toward marketing expenses for the enlarged trust.
Current AUSC directors Manju Malhotra and Steve Russell are expected to join JUGI's board once the deal completes.
JUGI posted net asset value total returns of 13.5% over one year, 46.2% over three years, -1.5% over five years and 155.2% over ten years as of August 31, 2026, according to the press release.
Shareholder documentation is expected in late October or early November 2026, with completion anticipated by year-end. The scheme requires approval from shareholders of both companies, tax clearances from HM Revenue & Customs and admission of the new JUGI shares to trading on the London Stock Exchange.
